Setting up MPCs

There are many ways in which a Producer Company can be promoted well within the provisions of the Act. However, based on our experience, organizing an efficient and inclusive Milk Producer Company (MPC) requires adoption of the following important norms and processes.

Ensure a fair and transparent transaction system with members,

Strengthen capacities of Board of Directors for good governance,

Professionalise the manpower of the Company with adequate training and orientation, and

Build awareness among the producer-members about their roles and responsibilities as well as about various aspects of the MPC’s operations.

The processes involved in setting up an MPC can be broadly divided into the following three phases:

Pre-Incorportaion

Incorporation

Post-Incorporation

Even after incorporation of the Producer Company, continuous efforts are required to assist the Producer Company to remain competitive and member centric. Some of major aspects which require constant attention are given below:

Accepting milk supplies only from the members.

Active user membership and their participation in business and governance. As women play an important role in animal husbandry activities as manager and decision makers, the MPC should aim to increase women’s participation. The MPC should also ensure women participation on the Board of the MPC.

Member equity in proportion to patronage – ‘building skin in the game’. If a milk producer puts his/her money in the form of equity capital in the Milk Producer Company, then he/she wants the company to perform at a high level to generate returns.

Patronage based member classes and member class representation on the Board.

Patronage based returns to the members.

Appropriate mechanism for member communication and grievance redressal.

Professionally managed business operations and economy of a scale sufficient to ensure viability and self-sustenance at the earliest.

Building an efficient value chain management for maximising returns to its members.

Leveraging technology for information and data management to ensure transparency and delivery of need based services.